Energy blow

Job cuts loom as nPower plans major restructuring

gas, Ofgem, price caps

Npower and SSE had planned a merger of gas and electricity services

Thousands of jobs are are at risk after energy giant Npower announced plans to restructure its UK business.

The company’s parent company E.On will merge computer systems to save money.

Centres at Houghton le Spring, near Sunderland, an office in Hull and one in Worcester are most likely to be affected by cuts.

There are around 2,500 jobs at Houghton le Spring, and more than 1,200 at the Hull and Worcester offices.

The company said it will enter into negotiations with the unions in the coming weeks.

“The UK market is currently particularly challenging,” said Johannes Teyssen, E.On chief executive.

“We’ve emphasised repeatedly that we’ll take all necessary action to return our business there to consistent profitability.”

The company and Perth-based SSE aborted plans a year ago to merge their retail operations. SSE sold the division to Ovo in September.

In January nPower announced plans to cut 900 jobs in Britain this year to lower operating costs. The number is close to the general turnover in the company which has a UK workforce of 6,300.

Britain’s energy market regulator Ofgem imposed a price cap on default energy bills from the turn of the year to save households about a billion pounds a year, following a government promise to tackle rising prices.

However, Ofgem itself expected the cap to lead to five of the Big Six energy companies making a loss or lower profits.

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